"Frontline" Alert

Tonight at 10 pm et. the PBS show Frontline will air an episode titled The Untouchables. This episode will examine why not one bank CEO has been jailed for the activity leading up to the financial crisis of 2008.

31. Yes, Frontline avoided the nitty-gritty legal definitions.

35. And John Q. Public has trouble following it.

Many can't follow when they get lost in translation, of the definitions that is.
I am glad they Frontline tried to keep from having unintended misinformation that putting that stuff in could/would cause.

34. Having a bozo with the CEO title is their best defense

They need a rich kid with an MBA, not too difficult to find, and keep promoting him through the ranks. Because they keep him occupied away from the real decision making, he can plead ignorance of what was going on and the Feds can't possibly prove intent because that was simply not part of his job.

Remember Ken Lay's defense? He had no idea Enron was on the brink of disaster because he was busy redecorating his office. I believed him, I've seen the type they put into those spots and the kind of busywork they do and what sort of decisions they're trusted with.

At least starting with the small fry would allow them to trace the whole process. Making deals with some of the small fry would get them up the food chain to the real scumbags.

38. Kick & Rec. There should be re-run on your local PBS station for those who missed it.

39. The worst is, this apparently focusses on the least of the problem(s).

Sorry I didn't see the show, so maybe I'm off-base. But.

Bad mortgage loans were the least of the problem. There were lots of bad mortgages, and they were/are a problem, yes. But at least they were secured by physical real estate.

But the reason there were so many bad mortgages made was because there was money to be made off securitizing them.

And even more importantly, there was even more money to be made off of betting about them (the infamous "credit derivatives") – especially off of betting against them, betting that they WOULD eventually crater – as Goldman et al. did in fact bet, even while selling them to others.

And thanks to Paulson, Geithner, Obama, et al, we, YOU AND ME, made good on those bets. They were placed with an insolvent bookie, AIG; and Goldman and the others who placed them knew or should have known AIG wouldn't be able to make good on them; but thanks to Geithner et al, we bailed AIG out; so instead of having AIG go belly-up and letting Goldman et al. take cents on the dollar for their speculative, not to mention felonious claims, through a bankruptcy-like procedure, we enabled AIG to PAY those bets to Goldman et al. To the tune of $16 trillion or so.

And until you understand all that, you don't begin to grasp the looting that has occurred.

40. PS: If any of those involved in the debacle were in fact as clueless as claimed,

they should at the minimum be fired and barred from any further involvement in banking for life.

Instead, they got bonuses. Because they succeeded in what they set out to do.

Note: The reason I'm so sure about all this is because we went through it on a much smaller scale with the S&L mess in the 80's. And we liquidated bad banks instead of bailing them out, and prosecuted their senior execs. and sent them to jail, and there were a few bad years but we enabled the economy to recover without undue delay.